How to Open NPS Account Online?

When you are in your 20s, retirement can seem so far off. Hence, saving and investing for that stage of life may not seem necessary at the moment. However, the truth is, the years slip by quickly and building a sizeable corpus becomes difficult if you don’t begin early. Not to mention, your responsibilities and financial obligations only increase with age.

So, what is a viable route to help you grow your wealth and secure your old age? Well, there are many financial schemes out there that can help you achieve this goal. But let’s focus on one such scheme sponsored by the Indian government – National Pension Scheme (NPS). Read this article to learn everything you need to know about NPS account opening.

What is NPS?

NPS is a voluntary contribution scheme and a social security initiative launched by the Central Government. The scheme was introduced to benefit self-employed individuals and employees of the unorganised sector, private sector, and the public sector besides the Armed Forces.

Simply put, NPS is a pension scheme that encourages you to invest some money in a pension account regularly during your employment and secure a monthly pension for your post-retirement life. Hence, your contribution to the scheme is locked until your retirement, and you can only make partial withdrawals for specific reasons.

Besides, the National Pension Scheme has broad eligibility, and any Indian citizen between the age of 18 and 60 is eligible for the scheme. However, you must be KYC compliant and not have a pre-existing NPS account. Now, if you want to apply for NPS online, keep reading.

Additional Read: What is the National Pension Scheme (NPS)? Does it Help in Saving Tax?

Steps to apply for NPS online

While you can open an NPS account online or offline, the former is a much more convenient route. You can apply for the account from the comfort of your home and in just a few clicks. To apply for NPS online, follow these simple steps:

Step 1: Visit the Tata Capital Moneyfy Website to register online.

Step 2: Choose the ‘open NPS account instantly’ option and proceed to fill the form.

Step 3: Enter a few personal details, including your mobile number.A verification codewill be sent to your registered number.

Step 4: Enter the 6-digit OTP to verify it. You will be redirected to a different application form.

Step 5: Fill in your personal details, KYC details and FATCA, investment details, and upload the relevant documents.

Step 6: Finally, make the required payment to open your NPS account.

Types of NPS accounts

NPS offers two types of accounts:

- NPS Tier 1 account: This is the primary retirement account, designed to encourage long-term savings. It offers significant tax benefits under Section 80C and Section 80CCD(1B) of the Income Tax Act. Upon maturity, 60% of the corpus can be withdrawn tax-free, while the remaining 40% must be used to purchase an annuity, which provides a regular pension.- NPS Tier 2 account: This is a voluntary savings account, offering greater flexibility and liquidity. Subscribers can freely withdraw from this account without any restrictions or penalties. However, contributions to the Tier 2 account do not qualify for tax deductions.

In a nutshell

So you see, the process of applying for an NPS account online is a walk in the park. And if you are looking for a platform that can handle all your investment needs, consider Tata Capital’s Moneyfy app! It allows you to customise your investment choices, set unique financial goals and compare different funds.

You can use the Moneyfy app to invest in mutual funds, apply for a loan or insurance and even invest in the National Pension Scheme. So, download the app and start planning for your retirement right away!

Frequently asked questions

1. When can I open a Tier II account?

You can open a Tier II account only after you have an active NPS Tier I account. The Tier II account is an optional, flexible savings account that can be opened at any time after your Tier I account is active.

2. Can I change the data in my NPS account?

Yes, you can update or change the data in your NPS account online through the NPS portal.

3. Will I have to re-open an NPS account when I change jobs or locations?

No, you do not need to re-open an NPS account when you change jobs or locations. You simply need to inform your new employer to continue contributions.

4. Is it possible to open an NPS account offline?

Yes, you can open an NPS account offline. To do this, visit a designated Point of Presence (PoP), such as a bank branch, and fill out the required forms along with the necessary documents.